A leading Italian Catholic cardinal and an ex-government minister are under investigation for corruption.
Cardinal Crescenzio Sepe, the archbishop of Naples, previously ran the department that co-ordinates the Vatican’s foreign missions.
He is accused of colluding with Pietro Lunardi, a former transport minister, to offer cut-price property deals.
He says he will co-operate with the investigation despite his immunity as a Vatican diplomatic passport holder.
Cardinal Sepe is regarded as one of the most prominent cardinals in Italy, says the BBC’s David Willey, in Rome.
Until 2006 he headed the Vatican department in control of financing overseas missions.
In that position he enjoyed access to the department’s enviable portfolio of cash and property assets.
He now faces investigation alongside Mr Lunardi, a former minister in the centre-right government of Prime Minister Silvio Berlusconi, under the scope of an magistrates’ investigation into a major corruption scandal involving prominent politicians.
Unwelcome news
According to newspaper reports in Italy, the pair are alleged to have colluded over a property deal that saw Mr Lunardi buy a building in Rome from Cardinal Sepe’s department in 2004.
The building was sold at a price noticeably below market value, it is alleged.
In a statement, the Vatican said it hoped the situation “could be cleared up fully and rapidly in order to eliminate any shadows, be they on the person [Sepe] or Church institutions”.
Emerging from church in Naples on Sunday, Cardinal Sepe told reporters: “The truth will emerge … I am serene.”
Coming on top of months of revelations about sexual abuse scandals, the latest corruption allegations are unwelcome news at the Vatican, our correspondent says.
Ordaining new priests at ceremony at St Peter’s Basilica on Sunday, Pope Benedict XVI criticised priests who he said used their office to acquire power and personal prestige and to advance their careers.
Source: Senior Italian cardinal accused of corruption – BBC News